Copper prices halves Sandfire profits

PERTH (miningweekly.com) – ASX-listed Sandfire Resources has seen its interim profit after tax halved during the six months to December, compared with the previous corresponding period, as lower copper prices impacted on its earnings.

Profits after tax for the interim period declined from A$30.6-million in the first half of 2015 to A$15.7-million, as sales revenue declined from A$261.8-million to A$228.3-million during the period under review.

Some 30 454 t of copper and 14 467 oz of gold were sold during the six months, compared with the 32 500 t of copper and 18 330 oz of gold in the previous corresponding period.

Sandfire told shareholders on Thursday that the fall in sales revenue reflected a higher year-end concentrate holding and the lower US dollar copper price, which fell by about 18% during the half-year, and which was only partially offset by the lower US/Australian dollar exchange rate.

Sandfire MD Karl Simich noted that the DeGrussa project, in Western Australia, had delivered a stand-out performance in the first half of the financial year, either achieving or exceeding all its key production and cost targets.

“DeGrussa continues to deliver strong cash flows despite a challenging business environment, and this is testament to both the grade and quality of the deposit and the continued focus of our team on controlling costs, delivering on targets and continually improving our performance.”

Looking ahead, Sandfire noted that it was on track to reach its full production guidance of between 65 000 t to 68 000 t of copper, with C1 cash costs expected to be at the lower end of the $0.95/lb to $1.05/lb guidance.